Orange Beach draws 8 million annual visitors into a 4,200-listing STR market where peak-season ADR reached $385 in July 2025.
Market Overview
Orange Beach, Alabama is one of the Gulf Coast’s most active short-term rental markets, with 4,203 active listings recorded in February 2026. That supply figure has grown significantly over five years, up from roughly 2,692 listings in 2021, which has redistributed occupancy across a larger base of properties. The market-wide average occupancy in the most recent data month (February 2026) was 30%, reflecting the typical winter slowdown for a coastal beach destination. On an annual basis, occupancy averaged 39.7% across 2025, compared to 51.5% in 2021 when inventory was considerably tighter.
Average daily rates have moved in the opposite direction from occupancy. ADR averaged $391 across 2025, up from $286 in 2021, a 37% increase over four years. That means revenue per available night (RevPAR) has held relatively stable even as occupancy has compressed, because higher per-night rates have partially offset lower utilization rates. The February 2026 ADR average was $383, with a median of $347.
The Orange Beach area draws an estimated 8 million visitors annually to a city with a permanent population of only 8,534. That visitor-to-resident ratio is among the highest of any Gulf Coast market and underpins sustained demand for vacation rentals. The presence of Gulf State Park, direct beach access, and a concentration of waterfront dining and water-sport operators makes Orange Beach a year-round destination, though demand is heavily weighted toward the summer months.
Seasonal Patterns
| Month | Occupancy | ADR | Revenue | Active Listings |
|---|---|---|---|---|
| Jan | 26% | $281 | $2,654 | 3,293 |
| Feb | 42% | $282 | $3,757 | 3,346 |
| Mar | 53% | $307 | $5,662 | 2,958 |
| Apr | 46% | $304 | $4,861 | 2,976 |
| May | 49% | $345 | $6,051 | 2,899 |
| Jun | 55% | $381 | $7,692 | 3,066 |
| Jul | 53% | $385 | $8,135 | 3,227 |
| Aug | 48% | $320 | $5,534 | 3,211 |
| Sep | 45% | $293 | $4,483 | 3,197 |
| Oct | 41% | $288 | $3,990 | 3,129 |
| Nov | 33% | $273 | $3,015 | 3,229 |
| Dec | 28% | $289 | $2,880 | 3,272 |
Orange Beach follows a classic Gulf Coast seasonal curve with June and July as the clear peak and January as the slowest month.
June averaged 55% occupancy and $381 ADR across the data period, producing average monthly revenue of $7,692. July edged slightly higher on ADR at $385 with 52.6% occupancy and $8,135 average revenue, making it the highest-revenue month of the year. May is a strong shoulder month at 48.6% occupancy and $345 ADR, averaging $6,051 in revenue.
March and April show meaningful spring-break and Easter traffic, with March averaging 53% occupancy at $307 ADR ($5,662 revenue) and April at 46% occupancy and $304 ADR ($4,861 revenue). March occupancy actually exceeds July’s on a multi-year average, reflecting concentrated spring-break demand.
The slowdown is pronounced in the back half of the year. August drops to 48.4% occupancy and $320 ADR ($5,534 revenue) as summer winds down, then September falls to 45% and $293 ADR ($4,483 revenue). October through January represents the off-season: occupancy ranges from 26% to 41%, and ADR dips to the $273-$289 range.
For operators, this means roughly five strong revenue months (March through July), three moderate months (August through October), and four months of materially reduced income. Pricing strategy should capture premium rates in June and July while using dynamic discounting in the November-February window to maintain minimum occupancy thresholds.
Revenue Breakdown
| Metric | 25th Pctile | Median | 75th Pctile | 90th Pctile |
|---|---|---|---|---|
| Revenue/mo | $1,197 | $2,560 | $4,576 | $6,708 |
| ADR | $262 | $347 | $458 | $577 |
| Occupancy | 12% | 26% | 45% | 57% |
Revenue in Orange Beach is distributed unevenly across the listing pool. In February 2026, the bottom quartile of active properties (p25) generated $1,197 or less in gross revenue. The median property produced $2,560. Properties at the 75th percentile reached $4,576, and top-decile properties (p90) hit $6,708 in a single winter month.
Those figures become more meaningful in context: February is one of the weakest months of the year. The same percentile tiers in June or July would be substantially higher based on seasonal patterns. July’s market-wide average revenue was $8,135.
The ADR spread is also wide. In February 2026, the p25 ADR was $262, the median was $347, the p75 was $458, and the p90 ADR reached $577 per night. Properties commanding $458-$577 per night in the off-season are almost certainly beachfront or waterfront units with premium amenities. Interior properties, condos in less desirable complexes, or listings with weaker reviews will cluster near or below the median.
Investors should note that the 2025 full-year revenue average of $5,031 per month was pulled above median by high performers. Underwriting a new acquisition using p50 figures rather than averages provides a more conservative and realistic baseline.
Investment Analysis
Revenue Trend
RevPAR & ADR Trend
| Date | Revenue | RevPAR | ADR |
|---|---|---|---|
| Mar 2021 | $7,181 | $232 | $270 |
| Apr 2021 | $6,281 | $209 | $285 |
| May 2021 | $7,107 | $229 | $289 |
| Jun 2021 | $7,756 | $259 | $312 |
| Jul 2021 | $7,521 | $243 | $330 |
| Aug 2021 | $7,116 | $230 | $291 |
| Sep 2021 | $6,263 | $209 | $282 |
| Oct 2021 | $4,839 | $156 | $274 |
| Nov 2021 | $4,228 | $141 | $252 |
| Dec 2021 | $4,384 | $141 | $277 |
| Jan 2022 | $3,553 | $115 | $252 |
| Feb 2022 | $3,975 | $142 | $271 |
| Mar 2022 | $6,288 | $203 | $293 |
| Apr 2022 | $5,222 | $174 | $292 |
| May 2022 | $6,395 | $206 | $312 |
| Jun 2022 | $7,750 | $258 | $319 |
| Jul 2022 | $7,890 | $255 | $344 |
| Aug 2022 | $5,552 | $179 | $272 |
| Sep 2022 | $5,353 | $178 | $254 |
| Oct 2022 | $4,787 | $154 | $238 |
| Nov 2022 | $3,657 | $122 | $220 |
| Dec 2022 | $3,782 | $122 | $223 |
| Jan 2023 | $3,221 | $104 | $225 |
| Feb 2023 | $4,030 | $144 | $216 |
| Mar 2023 | $6,058 | $195 | $258 |
| Apr 2023 | $5,224 | $174 | $254 |
| May 2023 | $5,862 | $189 | $268 |
| Jun 2023 | $7,619 | $254 | $304 |
| Jul 2023 | $8,453 | $273 | $321 |
| Aug 2023 | $5,594 | $181 | $257 |
| Sep 2023 | $3,403 | $113 | $233 |
| Oct 2023 | $2,555 | $82 | $219 |
| Nov 2023 | $1,691 | $56 | $217 |
| Dec 2023 | $1,447 | $47 | $240 |
| Jan 2024 | $1,720 | $56 | $248 |
| Feb 2024 | $3,507 | $121 | $252 |
| Mar 2024 | $3,481 | $112 | $336 |
| Apr 2024 | $2,782 | $93 | $323 |
| May 2024 | $4,638 | $150 | $401 |
| Jun 2024 | $6,305 | $210 | $464 |
| Jul 2024 | $7,342 | $237 | $431 |
| Aug 2024 | $4,227 | $136 | $372 |
| Sep 2024 | $3,348 | $112 | $335 |
| Oct 2024 | $3,443 | $111 | $325 |
| Nov 2024 | $2,386 | $80 | $314 |
| Dec 2024 | $2,216 | $72 | $321 |
| Jan 2025 | $2,273 | $73 | $300 |
| Feb 2025 | $4,006 | $143 | $288 |
| Mar 2025 | $5,302 | $171 | $376 |
| Apr 2025 | $4,794 | $160 | $367 |
| May 2025 | $6,251 | $202 | $453 |
| Jun 2025 | $9,033 | $301 | $508 |
| Jul 2025 | $9,470 | $306 | $499 |
| Aug 2025 | $5,182 | $167 | $407 |
| Sep 2025 | $4,049 | $135 | $362 |
| Oct 2025 | $4,327 | $140 | $382 |
| Nov 2025 | $3,114 | $104 | $364 |
| Dec 2025 | $2,569 | $83 | $384 |
| Jan 2026 | $2,506 | $81 | $379 |
| Feb 2026 | $3,269 | $117 | $383 |
Occupancy vs Supply
| Date | Occupancy | Active Listings |
|---|---|---|
| Mar 2021 | 72% | 2,404 |
| Jun 2021 | 51% | 2,669 |
| Sep 2021 | 64% | 2,776 |
| Dec 2021 | 42% | 2,828 |
| Mar 2022 | 53% | 2,527 |
| Jun 2022 | 60% | 2,867 |
| Sep 2022 | 53% | 2,745 |
| Dec 2022 | 37% | 2,704 |
| Mar 2023 | 61% | 2,802 |
| Jun 2023 | 67% | 2,866 |
| Sep 2023 | 37% | 2,700 |
| Dec 2023 | 19% | 2,784 |
| Mar 2024 | 34% | 2,897 |
| Jun 2024 | 42% | 2,481 |
| Sep 2024 | 34% | 3,406 |
| Dec 2024 | 22% | 3,862 |
| Mar 2025 | 45% | 4,160 |
| Jun 2025 | 55% | 4,448 |
| Sep 2025 | 37% | 4,360 |
| Dec 2025 | 22% | 4,180 |
The Orange Beach STR market presents a wide range of outcomes depending on property type, location, and management quality. Based on February 2026 data, the median property generated approximately $2,560 in gross revenue that month, a low-season figure. The 75th-percentile property brought in $4,576 and the 90th-percentile property reached $6,708 in that single month alone.
Annualizing the 2025 monthly average of $5,031 in gross revenue suggests a typical active listing generated roughly $60,000 per year before expenses. Top-quartile performers earning at or above the p75 threshold consistently would push well above that figure during peak months.
Entry costs are high relative to most STR markets. The typical home value in Orange Beach is $669,036, with a median sale price of $605,416. Current for-sale inventory sits at 733 units, and properties are taking a median of 95 days to go pending, with a sale-to-list ratio of 95.6%. That slower sales pace and below-ask pricing signal a buyer’s market at the moment, which may improve acquisition terms.
At a $600,000 purchase price with 25% down ($150,000) and a 7% mortgage rate, principal and interest alone would run approximately $3,200 per month. A property generating the 2025 average of $5,031/month gross would need to clear hosting fees (typically 15-25%), cleaning, insurance, HOA, and maintenance before reaching net income. Investors should model conservatively using p50 revenue figures, not averages, since the average is pulled up by high-performers.
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Start Free TrialHome Value Trends
| Date | Typical Home Value |
|---|---|
| Mar 2021 | $487,899 |
| Dec 2021 | $582,614 |
| Sep 2022 | $641,645 |
| Jun 2023 | $655,503 |
| Mar 2024 | $656,115 |
| Dec 2024 | $653,533 |
| Dec 2025 | $642,422 |
Booking Insights
Orange Beach bookings show a relatively long planning horizon. The average booking lead time in February 2026 was 92 days, with a median of 58 days. That gap between average and median suggests a segment of guests booking 4-6 months in advance (likely peak-summer reservations), while a larger share books 6-8 weeks out.
The average length of stay was 7.4 nights, with a median of 5 nights. A 5-7 night stay profile is consistent with weekly vacation rentals, particularly Saturday-to-Saturday or Sunday-to-Sunday turnovers that are common in Gulf Coast beach markets. This LOS pattern has practical implications: properties that enforce minimum stays of 5-7 nights during peak season can reduce turnover costs while maintaining high occupancy.
For pricing strategy, the 58-day median lead time suggests that dynamic pricing adjustments made 45-90 days before a date will capture the highest-intent bookings. Last-minute discounting in the 7-14 day window can fill gaps without cannibalizing full-price demand. During the February-April window, operators should have summer rates published and visible, as many guests are actively booking June and July stays during that period.
Short-Term Rental Regulations
Orange Beach has a structured short-term rental regulatory framework that investors must understand before listing a property.
The city defines a short-term rental as any rental of a single-family or two-family dwelling for 14 consecutive days or less. All operators are required to obtain a business license from the city. The license application fee is $500. The license number must be displayed prominently in all advertising, including online platform listings.
Operators are required to maintain a local property manager who is available 24 hours a day, 7 days a week. This is not optional and cannot be satisfied by a remote manager. For out-of-area investors, this requirement effectively mandates either hiring a local co-host or contracting with a full-service property management company.
The combined lodging tax rate is 9%, consisting of a 7% municipal tax and a 2% Baldwin County tax. Operators are responsible for collecting and remitting this tax. Most major booking platforms (Airbnb, Vrbo) collect and remit state and local taxes automatically in Alabama, but operators should verify their specific platform’s coverage to avoid double-remitting or gaps.
Zoning restrictions are an important variable. Some single-family residential neighborhoods restrict rentals to stays of 14 days or more, which would effectively prohibit short-term rental activity. Tourist and mixed-use zones allow shorter stays. Before purchasing any property for STR use, buyers should verify the specific zoning designation with the City of Orange Beach Planning Department. Purchasing in the wrong zone could render a property ineligible for short-term rental operation entirely.
Market Comparison
Orange Beach sits in the upper tier of Gulf Coast beach markets by both scale and ADR. With 4,203 active listings, it is a large market relative to comparable Alabama and Florida Panhandle beach towns. The 2025 full-year ADR of $391 places it above many inland or secondary coastal markets and on par with comparable Gulf Coast destinations.
The primary headwind distinguishing Orange Beach from tighter markets is supply growth. Listings increased from 2,692 in 2021 to 4,227 in 2025, a 57% increase in active inventory over four years. Over the same period, average occupancy fell from 51.5% to 39.7%. This supply-occupancy dynamic is common across Sun Belt coastal markets that saw a surge of STR investment from 2020 to 2022.
Compared to national STR benchmarks, a 39.7% annual average occupancy is below the typical threshold of 45-55% that characterizes healthy coastal resort markets. However, Orange Beach’s ADR of $391 is well above average for non-urban STR markets, partially compensating for lower utilization. The net result is that revenue outcomes are more dependent on achieving above-median ADR (through property quality, location, and marketing) than on simply being in the market.
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